14 February 2005 – Itasca (IL): OfficeMax president/CEO Chris Milliken has resigned from the company with immediate effect. Executive chairman George Harad will assume Milliken’s former responsibilities while a permanent successor is sought.
It is the third high-profile resignation to have hit the troubled reseller in just a matter of weeks. The year began with the departure of retail chief Gary Peterson, which was quickly followed by the exit of CFO Brian Anderson. At the time ‘Max announced that it was delaying the release of its Q4 results pending the conclusion of an internal investigation into improper billing.
As a consequence of the ongoing investigation, OfficeMax has confirmed that six employees have been fired after it had been found they had "fabricated supporting documents for approximately $3.3 million in claims billed to a vendor to its retail business."
The company also said it overstated Q1 operating income by $5 million – $10 million by failing to record certain rebates and payments to vendors. The accounting error led to the understatement of income in Q2 and Q3, the company said.
While giving no reasons for Milliken’s departure, Harad said in a statement this morning: "OfficeMax made substantial progress in 2004 toward integrating its contract and retail office products businesses. We appreciate the contributions that Chris has made in that effort and throughout his 27-year career with our office products business. We are taking steps to strengthen the OfficeMax management team, and fully expect to demonstrate the value inherent in this business for our shareholders."
OfficeMax expects the investigation to be completed by the third full week of February, while it will report its Q4 and FY results on 14 March.
In early trading this morning, OfficeMax’s share price had fallen $1.95, or 6 per cent, to stand at $29.80.